In re Beatty

• Decision Date: 27 January 1975
• Docket Number: Civil No. 74-591
• Citation: 11 V.I. 366
• Parties: RICHARD V. BEATTY, Plaintiff v. JOHN C. CLARK, INC., Defendant
• Court: U.S. District Court — Virgin Islands

11 V.I. 366

RICHARD V. BEATTY, Plaintiff v. JOHN C. CLARK, INC., Defendant

Civil No. 74-591

District Court of the Virgin Islands Div. of St. Thomas and St. John

January 27, 1975

Action for injunction. District Court, Christian, Chief Judge, held that where all properties in a parcel of large development were subject to a single family dwelling restrictive covenant, plaintiff, owner of a plot in the parcel, was entitled to have defendant enjoined from turning his house, also in the parcel, into a private club.

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FREDERICK WATTS, ESQ., St. Thomas, V.I., for plaintiff

ETHEL C. HUNTER, St. Thomas, V.I., for defendant

CHRISTIAN, Chief Judge

MEMORANDUM OPINION

This case involves the enforcement of a restrictive covenant in a deed to real property located in Estate Nazareth, St. Thomas, Virgin Islands. Plaintiff Beatty, on behalf of himself and other homeowners similarly situated, filed suit for an injunction barring defendant John C. Clark, Inc., a Maryland corporation, from operating The Sea Lord Club, a private membership club, on Lot No. 8-31 Estate Nazareth, Red Hook Quarter. A temporary restraining order was issued by this Court on October 7, 1974, and hearings on the action for a preliminary injunction were had on October 17, 18 and November 21, 1974.

The property here involved, both that of the plaintiff and defendant, was originally part of a Trust administered under the last will and testament of one Charles Redfield Vose. The trustees conveyed all of that land to the CowpetBay Corporation which, pursuant to a "master plan" drawn up in the early 1960s, has gradually developed the real estate in that area as a planned community. William Evans, an officer of that corporation and a trustee and executor under the Vose will, testified at the hearing. The Cowpet Bay Corporation is the common grantor of all the land involved in this action.¹ Defendant got its title from one Lambert, who had built on the property what is commonly known in the community as "Lambert's Castle," a sprawling, turreted building with seven bedrooms and baths, fronting the beach, which had been used by Lambert as a private dwelling.

Both Beatty's deed to Parcel No. 8-8 from Vardaman (the grantee of Cowpet Bay Corporation in 1965) and defendant's deed from Lambert contain identical restrictive covenants which run with the land. The covenant which plaintiff here seeks to enforce provides:

(a) Since the area is strictly residential, only single family dwellings shall be permitted, and no more than one such dwelling of a single story shall be constructed on any subdivision parcel without the written approval of the seller.

Defendant, although fully cognizant of the restriction contained in its deed, bought the property for the express purpose of conducting what its representative, Will Flas-cher, described as a private club. Defendant contacted all the homeowners in the development, explained his plan, and in effect solicited advance membership. There was testimony for the plaintiff that from the outset defendant's proposal was greeted with opposition, and that such opposition at no time wavered. In fact, letters from other of Beatty's neighbors were admitted into evidence, in which they not only expressed their displeasure with the scheme,but also authorized Beatty to go to court in their behalf. (Exh. 7) Nonetheless, defendant purchased the property, continued its membership solicitation and went so far as to apply for certain licenses required by Virgin Islands law.² The questions raised specifically by this action are: (a) Whether these restrictions were inserted in furtherance of a unified plan of development; (b) Whether enforcement should be denied because of a substantial change in the character of the neighborhood; (c) Whether there has been such toleration of other infractions as to constitute waiver and abandonment, thus estopping plaintiff from now complaining of this particular violation; (d) Whether the reservation in the common grantor to approve building contrary to the restrictions makes it all null and void; and (e) Whether plaintiff, in order to succeed, must show harm or injury of any kind.

As a prefatory matter, it should be noted that this particular plaintiff does have standing to bring this action. Retriction (m), common to all the deeds, provides:

Seller or any owner of land in the subdivision to which those covenants apply shall be entitled to a decree of injunction against any threatened or continuing violation of any of these covenants, (emphasis supplied).

See also Grubel v. MacLaughlin, 6 V.I. 490, 286 F.Supp. 24 (1968); Neal v. Grapetree Bay Hotels, Inc., 8 V.I. 267 (1971).

Mr. William Evans, president of Cowpet Bay Corporation, discussed at great length during the hearings his original and ultimate plans concerning the development ofthis area of St. Thomas. He offered a drawing (Exh. 17), circa 1962-63, which demonstrated the corporation's long range concept as to what the development should contain. This included not only a high-income residential area, but also recreational facilities, other forms of housing (condominiums, apartments, etc.), a proposed hotel, and neighborhood shopping facilities. Defendant argues that because the developmental plans were on such a large scale, and inclusive of many non-residential uses, enforcement of the covenant in its deed is inequitable. Part of its argument is that since all the land is part of the same development, it is unfair to say that one particular portion should be residential, especially when other non-residential facilities (e.g., the Virgin Islands Yacht Club) are in such close proximity.

Although a zoning exception was sought and granted for the purpose of building a hotel, action has been held in abeyance as to it for many years. As a matter of fact, aside from the Cowpet Bay Condominiums and the residential housing at issue, few of the other grandiose plans ever were put into effect. The Virgin Islands Yacht Club, located nearby, was originally part of the land administered by the Trust, but was withdrawn from it and has been in operation since 1966. Mr. Beatty purchased his property from Dr. Vardaman in 1969. Mr. Evans testified that there were three parcels, numbers 8, 9 and 5, which were to be kept mostly residential. Both plaintiff, defendant and plaintiff's amici³ own land in Parcel No. 8. What is more important, all those properties located in Parcel No. 8 contain the same restrictions, while it is by no means clear that the same, if any such restrictions attach to the balance of the land held, developed and conveyed by Cowpet Bay Corporation.

[1] There is some question as to whether defendant's proposed venture is in reality a private club or an effort to clothe a public hotel and restaurant in the garb of one so as to circumvent the zoning regulations.⁴ Mr. Flascher testified that meals and catering services would be available to members and guests both daily and on a special reservation (i.e., private party) basis, and that a bar providing alcoholic beverages would be operated. Further, the sleeping facilities would also be made available on a long- or short-term basis. It is unnecessary to decide this factual dispute, however, since if the restriction is valid and enforceable, it properly excludes the use of the Castle as either, irrespective of the uses permitted by the zoning code. Despite the fact that the zoning of this area may permit the erection and use of a building as a private club, the more stringent restriction contained in the covenant limiting use to single-family dwellings, if it is to be upheld, must take precedence. Staninger v. Jacksonville Expressway Authority, 182 So.2d 483, 22 A.L.R.3d 950 (Fla. App. 1966); Restatement of Property Section 568; 20 Am.Jur.2d Covenants, Conditions, Etc., Section 277.

[2] Defendant attacks the restriction on a phrase-by-phrase basis. It claims that the preamble, "since the area is strictly residential" is false and was false at the time it was first recorded in a deed in the early 1960's. The basis for this objection, as to others, is the master plan of development calling for the numerous non-residential uses recited above. As also pointed out above, however, most of those plans have fallen short of fulfillment. Most important, even on the master plan, certain areas are broken up and designated as purely residential. Defendant claims that plaintiff has failed in its burden to show that a sufficient number of deeds in the area are burdened with the re-striction to merit enforcement. We disagree. Given the monumental scale of the original concept, the clear-cut enclaves to be devoted to residential use, and the fact that plaintiff and defendant own land, containing reciprocal restrictions, in parcel No. 8 which Evans stated was to be kept mostly residential, it seems to us that the restriction has substance and merits enforcement, absent intervening factors.

[3] Nor does the fact that the restriction reserves some discretion in the Seller to waive certain requirements change the validity of the covenant. We recognize that the weight of authority supports the rule that a reservation by the common grantor of a general power to dispense with the restrictions on particular lots negatives the purpose of uniform development from which the mutuality of right among lot owners in a platted subdivision is deemed to arise. We are also aware that, generally, where such a power is reserved, one lot owner cannot enforce the restrictions as against another lot owner even though the dispensing power of the common grantor has not been exercised. Anno., 19 A.L.R.2d 1274, 1282 (1951). Such is not the case in the restriction under consideration, however. There, it states: "Only single family dwellings shall be permitted, and not more than one such dwelling of a single story shall be constructed on any subdivision parcel without the written approval of the seller." That language, to our...